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NORTHERN REAL ESTATE, WAVES IN THE PROVINCES

Date 21/09/2021

Exciting provincial land

The latest report from the Association of Real Estate Brokers in Vietnam said that since late 2017, the real estate market in the neighboring provinces of Hanoi began to heat up due to the presence of large investors. For example, with the participation of big investors such as Hoa Phat, TNR and other companies such as Lac Hong Phuc, Van Thuan Phat …, land market in Pho Noi area (Hung Yen) with the absorption rate of 70-80%, the average selling price is from 15-20 million VND / m2.

Dynamic foundation land market in provinces

The latest report of Vietnam Association of Real Estate Brokers shows that since late 2017, the real estate market in the neighboring provinces of Hanoi has began to heat up due to the presence of large investors. For example, with the participation of large investors such as Hoa Phat, TNR and other enterprises such as Lac Hong Phuc, Van Thuan Phat, etc., the foundation land market in Pho Noi (Hung Yen), in recent times, has been very active with the absorption rate of 70-80% and the average selling price of 15 – 20 million VND/m2.

In Van Giang (Hung Yen), with the effect from Vihajico’s Ecopark project and Vingroup’s Vincity Hung Yen project, the Brokers Association assesses that the market in this area will grow in both supply and price in the coming time. In particular, there will be a number of small investors launching products before Vingroup to catch up the market.

In Bac Giang city (Bac Giang province), projects such as Kosy Bac Giang, Bach Viet, An Huy urban areas, etc. are really stirring up the market with the distribution participation of real estate floors such as Danko, Midland, etc.

In Vinh Yen city (Vinh Phuc province), from the end of 2017, early 2018, a series of projects have been launched in the market such as An Phu, Mountain View, Nam Vinh Yen, etc. Not only does the supply increase but the transactions also take place actively after a long time. Many projects have been sold out after a short time of selling. Average prices of projects in this market range from 11 -15 million VND /m2. In the coming time, the market will receive more supply from Fairy Town project.

Also in Vinh Phuc, after being upgraded from town to city, Phuc Yen real estate has quickly risen, although there are not many projects implemented here. A few projects opened for sale such as TMS City Phuc Yen reached the absorption rate of 78% in just one week of sale of phase 1 with the prices ranging from 9-12 million VND/m2.

In Bac Ninh province as the industrial center and trade hub between Hanoi and Lang Son or easily connected to Hai Phong and Quang Ninh is always a hot spot for real estate. Despite great potential, in recent times, Bac Ninh market does not have many new projects. However, this year, the market will be warmed up with the appearance of investors such as Him Lam, Nam Hong, etc.

Meanwhile, the real estate supply in Bac Giang, which is located adjacent to Bac Ninh, is forecasted to be quite large as the whole province has more than 10 projects being implemented and planned to be sold since the second quarter of 2018. Notable real estate investors in Bac Giang include Kosy, Bach Viet. In terms of selling prices, the projects in Bac Giang city and districts are priced at 15 – 20 million VND/m2 and 4 – 10 million VND/m2, respectively.

Another notable provincial market is Thai Nguyen, the political, economic and educational center of the Northern Midlands. Over the past years, with the development of industry, foreign investment, and especially Samsung Group’s project, Thai Nguyen has attracted many workers in other localities to live and work, creating big demand for housing, thereby helping the real estate market here develop.

The leading enterprises in Thai Nguyen’s real estate market that can be mentioned include Tien Bo Corporation, Tecco Corporation, Kosy, Hong Vu, etc.

According to reporters, foundation land in Thai Nguyen has been strongly developed with projects in Song Cong and Pho Yen with the supply of about 2,200 foundations, of which Kosy urban area provides 500 foundations and Hong Vu urban area provides 400 foundations, etc. The price ranges from 3-10 million VND/m2 in the first quarter of 2018, increasing by 15% over the same period in 2017.

Meanwhile, apartment segment is mainly developed in Thai Nguyen city with 2,000 units, of which Tien Bo Group provides 430 units, Tecco provides about 400 units. The average price of apartments in the first quarter of 2018 is 11-12 million VND/m2, increasing by 10-15% over the same period in 2017.

In addition to the above markets, potential provinces such as Hai Duong, Thai Binh, Thanh Hoa, Nghe An and Lao Cai do not have many projects newly launched in the first quarter of 2018; however, there are signs showing that investors are completing legal procedures and preparing land clearance and infrastructure deployment to launch their products in the second quarter of 2018.

Things investors should note

According to Mr. Nguyen Van Dinh, Vice Chairman cum General Secretary of Vietnam Association of Real Estate Brokers, except that some major cities such as Ha Long (Quang Ninh), Thai Nguyen, Bac Ninh, Vinh (Nghe An) have a number of apartment projects, the projects in the Northern provinces are mainly new urban areas and the products are mainly foundation land, townhouses, shophouses, villas.

With these projects, in addition to the provinces with many industrial zones and high rates of mechanical population and real demands such as Bac Ninh, Hai Phong, Vinh Yen, Thai Nguyen, in the other provinces, most customers buy for investment.

The participation of secondary investors in these markets will easily push the market at risk of virtual fever. The land consolidation of investors took place in 2016, but it has been stronger from the end of 2017, early 2018. At first, only a few people sought to buy land, then it has dragged many others to buy land, creating virtual demands, pulling up the land prices.

Therefore, when investing in these projects, investors need to carefully study the legality of such projects, their financial capacity, investor prestige, local planning, etc.

According to Ms. Nguyen Hoai An, Manager of Consulting and Research Department of CBRE Hanoi, in recent years, Hanoi’s real estate has shifted away towards the Western area where infrastructure planning is very fast and complete.

In the coming time, the spread of the real estate market will be wider, targeting at areas far from the city center, which is resulted from the expansion of infrastructure such as Nhat Tan Bridge, Thanh Tri Bridge, and the urban railway in the future, etc., allowing real estate to develop beyond the city center. This is a condition that can help the peri-urban market develop more.

However, Ms. An noted that investors need to be careful because not every peri-urban area has potential real estate. Only areas that strongly attract foreign investment capital and have good infrastructure will be able to increase prices, while other areas are unlikely to have potential. If investors follow the fever without carefully studying, they will very easily suffer from stuck, buried capital.

On the same point of view, Mr. Nguyen Viet Cuong, Chairman of Kosy Group, said that in some neighboring provinces of Hanoi, there have been projects dividing and selling land and then abandon or change the original plan, under which no one else has to bear the risk other than customers.

Therefore, house buyers need to further observe to see if the investors follow exactly what they promise, especially in terms of the progress of the projects and the later operation of the projects./.

– Trang Viet – Real Estate Investment Newspaper –

 

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